Calculate the income elasticity of demand

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Reference no: EM13204599

Given the following information, calculate the income elasticity of demand using the midpoint formula.

a. Nancy's income increases from $20,000 to $30,000 and her consumption of spaghetti changes from 10 pounds per month to 2 pounds per month. Calculate the income elasticity of demand.

b. Interpret the result.

Reference no: EM13204599

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